TransUnion Announces Strong Third Quarter 2018 Results

TransUnion (NYSE: TRU) (the “Company”) today announced financial results for the quarter ended September 30, 2018.

Revenue:

Total Revenue was $604 million, an increase of 21 percent compared with the third quarter of 2017 (22 percent on a constant currency basis, 11 percent on an organic constant currency basis).

Adjusted Revenue, which removes the impact of deferred revenue purchase, accounting reductions and other adjustments to revenue for our recently acquired entities, was $621 million, an increase of 25 percent compared with the third quarter of 2017 (26 percent on a constant currency basis, 11 percent on an organic constant currency basis).

Earnings:

Net income attributable to TransUnion was $46 million, compared with $69 million in the third quarter of 2017. The decrease in net income attributable to TransUnion was due to incremental amortization and interest expense and integration-related costs resulting from our recent business acquisitions. As a result, diluted earnings per share was $0.24, compared with $0.36 in the third quarter of 2017.

Adjusted Net Income was $125 million, compared with $93 million in the third quarter of 2017. Adjusted Diluted Earnings per Share was $0.65, compared with $0.49 in the third quarter of 2017.

Adjusted EBITDA was $245 million, an increase of 26 percent compared with the third quarter of 2017 (28 percent on a constant currency basis). Adjusted EBITDA margin was 39.4 percent, compared with 39.0 percent in the third quarter of 2017.

“TransUnion delivered another quarter of strong performance with double-digit growth in Revenue, Adjusted Revenue and Adjusted EBITDA along with strong organic revenue growth in all three segments,” said Jim Peck, President and CEO. “We continue to execute well and are delivering broad-based growth as a result of our industry-leading innovation, attractive vertical and geographic markets and differentiated technology platform.”

“As we look forward to the end of 2018 and to 2019, we remain bullish that we can continue to drive strong, above market growth as we continue to deliver meaningful innovation, integrate and fully leverage our recent acquisitions and also continue to gain market share from key accounts,” he concluded.

Third Quarter 2018 Segment Results

U.S. Information Services (USIS)

USIS revenue was $375 million, an increase of 20 percent compared with the third quarter of 2017 (11 percent on an organic basis). USIS Adjusted Revenue was $376 million.

Online Data Services revenue was $235 million, an increase of 17 percent compared with the third quarter of 2017 (11 percent on an organic basis).

Marketing Services revenue was $60 million, an increase of 23 percent compared with the third quarter of 2017

Decision Services revenue was $80 million, an increase of 26 percent compared with the third quarter of 2017 (3 percent on an organic basis). Adjusted Revenue was $81 million.

Operating income was $93 million, an increase of 12 percent compared with the third quarter of 2017. Adjusted Operating Income was $131 million, an increase of 19 percent compared with the third quarter of 2017 (15 percent on an organic basis).

International

International revenue was $129 million, an increase of 36 percent compared with the third quarter of 2017 (42 percent on a constant currency basis, 12 percent on an organic constant currency basis). International Adjusted Revenue was $145 million.

Developed markets revenue was $64 million, an increase of 89 percent (92 percent on a constant currency basis, 9 percent on an organic constant currency basis) compared with the third quarter of 2017. Adjusted Revenue was $80 million.

Emerging markets revenue was $65 million, an increase of 6 percent compared with the third quarter of 2017 (14 percent on a constant currency basis).

Operating income was $4 million, a decrease of 80 percent (70 percent on a constant currency basis) compared with the third quarter of 2017. The decrease was due to incremental amortization expense and integration-related costs resulting from our recent business acquisition. Adjusted Operating Income was $50 million, an increase of 54 percent compared with the third quarter of 2017 (62 percent on a constant currency basis, 18 percent on an organic constant currency basis).

Consumer Interactive

Consumer Interactive revenue was $119 million, an increase of 11 percent compared with the third quarter of 2017. Revenue in the third quarter of 2018 included approximately $5 million of incremental credit monitoring revenue due to a breach at a competitor.

Operating income was $57 million, an increase of 22 percent compared with the third quarter of 2017. Adjusted Operating Income was $59 million, an increase of 21 percent compared with the third quarter of 2017.

Liquidity and Capital Resources

Cash and cash equivalents were $227 million at September 30, 2018 and $116 million at December 31, 2017. Total debt, including the current portion of long-term debt, was $4.1 billion at September 30, 2018, compared with $2.5 billion at December 31, 2017. The increase was due to the funding of our Callcredit, iovation and HPS acquisitions, which closed in the second quarter of 2018.

For the nine months ended September 30, 2018, cash provided by continuing operations was $410 million compared with $347 million in 2017. The increase was due primarily to the increase in operating performance, partially offset by an increase in interest expense resulting from the increase in outstanding debt. Cash used in investing activities was $1,927 million compared with $149 million in 2017, due primarily to the significant increase in cash used to fund acquisitions. Capital expenditures were $118 million compared with $91 million in 2017. Cash from financing activities was $1,634 million compared with a use of cash of $127 million in 2017. The increase in cash provided by financing activities was due primarily to cash borrowed to fund our acquisitions and a decrease in treasury stock repurchased, partially offset by dividends paid in 2018.

2018 Full Year Outlook

For the full year of 2018, we are raising our Adjusted Revenue, Adjusted EBITDA and Adjusted Diluted Earnings per Share guidance as follows. Adjusted Revenue is expected to be between $2.342 billion and $2.347 billion, an increase of 21 percent compared with 2017. Adjusted EBITDA is expected to be between $912 million and $915 million, an increase of 22 percent. Adjusted Diluted Earnings per Share is expected to be between $2.46 and $2.47, an increase of 31 to 32 percent. Adjusted Diluted Earnings per Share includes a benefit of approximately $0.31 due to the recently enacted Tax Cuts and Jobs Act. Adjusted Diluted Earnings per Share guidance also includes an approximate $0.02 headwind from unfavorable foreign exchange rates and an approximate $0.01 per share headwind from the impact of higher LIBOR rates on the debt existing prior to the incremental financing activities completed in June 2018.

The Adjusted Revenue guidance includes approximately 10 points growth from acquisitions that closed in the prior year and in the second quarter of 2018, as well as approximately 50 basis points of drag on Adjusted Revenue and approximately 70 basis points of drag on Adjusted EBITDA from foreign exchange rates. Our guidance also includes approximately $16 million of incremental monitoring revenue due to a breach at a competitor, compared with $4 million in 2017. The expected increase in this incremental revenue represents 0.5 percent of the total growth.

2018 Fourth Quarter Outlook

For the fourth quarter of 2018, Adjusted Revenue is expected to be between $620 million and $625 million, an increase of 23 to 24 percent compared with the fourth quarter of 2017. Adjusted EBITDA is expected to be between $243 million and $246 million, an increase of 24 to 26 percent. Adjusted Diluted Earnings per Share is expected to be between $0.62 and $0.63, an increase of 24 to 26 percent. Adjusted Diluted Earnings per share includes a benefit of approximately $0.08 due to the recently enacted Tax Cuts and Jobs Act.

The fourth quarter Adjusted Revenue guidance includes approximately 15 points of growth from acquisitions that closed in the prior year and in the second quarter of 2018. Foreign exchange rates are driving approximately 1 percent of drag on Adjusted Revenue and 2 percent drag on Adjusted EBITDA.

Given the size of the Callcredit acquisition, beginning in the third quarter 2018, we have modified our Non-GAAP financial measures of Adjusted Operating Income, Adjusted EBITDA, Adjusted Net Income and Adjusted Diluted Earnings per Share to add back costs incurred relating to our integration of Callcredit. We expect to add these costs back to these Non-GAAP performance measures for approximately two years. Additionally, beginning with the third quarter 2018, we have begun to disclose the Non-GAAP financial measure of Adjusted Revenue. Adjusted Revenue is intended to reflect what revenue would have been had we not reduced the amount of deferred revenue on the opening balance sheets for recently acquired businesses as a result of applying business combination fair value accounting principles. We expect deferred revenue adjustments for acquisitions that closed in the second quarter of 2018 to primarily last for approximately one year, with the remainder to last up to two years. We believe the best period-over-period comparison of revenue over the next one to two years as we run off this impact will be Adjusted Revenue compared with GAAP revenue in periods prior to and after the impact of this run-off is complete. Further, revenue from certain non-core customer contracts of Callcredit that are not classified as discontinued operations and that are expected to expire within one year have been excluded from Adjusted Revenue. See Non-GAAP Financial Measures below and Schedules 1, 2, 3, 5 and 7 for additional information.

Earnings Webcast Details

In conjunction with this release, TransUnion will host a conference call and webcast today at 8:00 a.m. Central Time to discuss the business results for the quarter and certain forward-looking information. This session may be accessed at www.transunion.com/tru. A replay of the call will also be available at this website following the conclusion of the call.

About TransUnion

TransUnion is a leading global risk and information solutions provider to businesses and consumers. The Company provides consumer reports, risk scores, analytical services and decisioning capabilities to businesses. Businesses embed its solutions into their process workflows to acquire new customers, assess consumer ability to pay for services, identify cross-selling opportunities, measure and manage debt portfolio risk, collect debt, verify consumer identities and investigate potential fraud. Consumers use its solutions to view their credit profiles and access analytical tools that help them understand and manage their personal information and take precautions against identity theft.

Availability of Information on TransUnion’s Website

Investors and others should note that TransUnion routinely announces material information to investors and the marketplace using SEC filings, press releases, public conference calls, webcasts and the TransUnion Investor Relations website. While not all of the information that the Company posts to the TransUnion Investor Relations website is of a material nature, some information could be deemed to be material. Accordingly, the Company encourages investors, the media, and others interested in TransUnion to review the information that it shares on www.transunion.com/tru.

Non-GAAP Financial Measures

This earnings release presents constant currency growth rates assuming foreign currency exchange rates are consistent between years. This allows financial results to be evaluated without the impact of fluctuations in foreign currency exchange rates. This earnings release also presents organic constant currency growth rates, which assumes consistent foreign currency exchange rates between years and also eliminates the impact of our recent acquisitions. This allows financial results to be evaluated without the impact of fluctuations in foreign currency exchange rates and the impacts of recent acquisitions. This earnings release also presents Adjusted Revenue for periods beginning July 1, 2018, and Adjusted EBITDA, Adjusted EBITDA Margin, segment Adjusted Operating Income, segment Adjusted Operating Margin, Adjusted Effective Tax Rate, Adjusted Net Income (Loss) and Adjusted Diluted Earnings per Share for all periods presented. These are important financial measures for the Company but are not financial measures as defined by GAAP. We present these financial measures as supplemental measures of our operating performance because we believe they provide meaningful information regarding our performance and provide a basis to compare operating results between periods. We present Adjusted Operating Income, Adjusted EBITDA and Adjusted Net Income as supplemental measures of our operating performance because these measures eliminate the impact of certain items that we do not consider indicative of our cash operations and ongoing operating performance. Also, Adjusted EBITDA is a measure frequently used by securities analysts, investors and other interested parties in their evaluation of the operating performance of companies similar to ours. In addition, our board of directors and executive management team use Adjusted Revenue and Adjusted EBITDA as compensation measures. Furthermore, under the credit agreement governing our senior secured credit facility, our ability to engage in activities such as incurring additional indebtedness, making investments and paying dividends is tied to a ratio based on Adjusted EBITDA. These financial measures should be reviewed in conjunction with the relevant GAAP financial measures and are not presented as alternative measures of GAAP. Other companies in our industry may define or calculate these measures differently than we do, limiting their usefulness as comparative measures. Because of these limitations, these non-GAAP financial measures should not be considered in isolation or as substitutes for performance measures calculated in accordance with GAAP, including operating income, operating margin, effective tax rate, net income (loss) attributable to the Company, earnings per share or cash provided by operating activities. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are presented in the attached Schedules.

Adjusted Revenue is defined as GAAP revenue adjusted for certain acquisition-related deferred revenue and non-core contract-related revenue as further discussed in footnote 1 of the attached Schedules 2, 3, 5 and 7. Adjusted EBITDA is defined as net income (loss) attributable to TransUnion plus (less) loss (income) from discontinued operations, plus net interest expense, plus (less) provision (benefit) for income taxes, plus depreciation and amortization, plus (less) the revenue adjustments included in Adjusted Revenue, plus stock-based compensation, plus mergers, acquisitions, divestitures and business optimization-related expenses including Callcredit integration-related expenses, plus (less) certain other expenses (income). Adjusted Operating Income is defined as operating income plus (less) the revenue adjustments included in Adjusted Revenue, plus stock-based compensation, plus certain mergers, acquisitions, divestitures and business optimization-related expenses including Callcredit integration-related expenses, plus (less) certain other expenses (income), plus amortization of certain intangible assets. Adjusted Effective Tax Rate is defined as Adjusted Provision for Income Taxes divided by Adjusted Income Before Income Taxes. Adjusted Net Income is defined as net income (loss) attributable to TransUnion plus (less) loss (gain) from discontinued operations, plus (less) the revenue adjustments included in Adjusted Revenue, plus stock-based compensation, plus mergers, acquisitions, divestitures and business optimization-related expenses including Callcredit integration-related expenses, plus (less) certain other expenses (income), plus amortization of certain intangible assets, plus or minus the related changes in provision for income taxes, less any one-time tax provision benefits from the Tax Cuts and Jobs Act. Adjusted Diluted Earnings per Share is defined as Adjusted Net Income divided by the weighted-average diluted shares outstanding. The above definitions apply to our calculations for the historical periods shown on schedules 1 through 5, and for the periods covered by our guidance as shown in Schedule 7.

Forward-Looking Statements

This earnings release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on the current beliefs and expectations of TransUnion’s management and are subject to significant risks and uncertainties. Actual results may differ materially from those described in the forward-looking statements. Any statements made in this earnings release that are not statements of historical fact, including statements about our beliefs and expectations, are forward-looking statements. These statements often include words such as “anticipate,” “expect,” “guidance,” “suggest,” “plan,” “believe,” “intend,” “estimate,” “target,” “project,” “should,” “could,” “would,” “may,” “will,” “forecast,” “outlook,” “potential,” “continues,” “seeks,” “predicts,” or the negative of these words and other similar expressions. Factors that could cause actual results to differ materially from those described in the forward-looking statements include macroeconomic and industry trends and adverse developments in the debt, consumer credit and financial services markets; our ability to provide competitive services and prices; our ability to retain or renew existing agreements with large or long-term customers; our ability to maintain the security and integrity of our data; our ability to deliver services timely without interruption; our ability to maintain our access to data sources; government regulation and changes in the regulatory environment; litigation or regulatory proceedings; regulatory oversight of “critical activities;” our ability to effectively manage our costs; economic and political stability in the United States and international markets where we operate; our ability to effectively develop and maintain strategic alliances and joint ventures; our ability to timely develop new services and the market’s willingness to adopt our new services; our ability to manage and expand our operations and keep up with rapidly changing technologies; our ability to make acquisitions, successfully integrate the operations of acquired businesses and realize the intended benefits of such acquisitions; our ability to protect and enforce our intellectual property, trade secrets and other forms of unpatented intellectual property; our ability to defend our intellectual property from infringement claims by third parties; the ability of our outside service providers and key vendors to fulfill their obligations to us; further consolidation in our end-customer markets; the increased availability of free or inexpensive consumer information; losses against which we do not insure; our ability to make timely payments of principal and interest on our indebtedness; our ability to satisfy covenants in the agreements governing our indebtedness; our ability to maintain our liquidity; share repurchase plans; our reliance on key management personnel; and other one-time events and other factors that can be found in our Annual Report on Form 10-K for the year ended December 31, 2017, and any subsequent Quarterly Report on Form 10-Q or Current Report on Form 8-K, which are filed with the Securities and Exchange Commission and are available on TransUnion’s website (www.transunion.com/tru) and on the Securities and Exchange Commission’s website (www.sec.gov). Many of these factors are beyond our control. The forward-looking statements contained in this earnings release speak only as of the date of this earnings release. We undertake no obligation to publicly release the result of any revisions to these forward-looking statements to reflect the impact of events or circumstances that may arise after the date of this earnings release.

In addition to factors previously disclosed in TransUnion’s reports filed with the Securities and Exchange Commission and those identified elsewhere in this press release, the following factors, among others, could cause actual results to differ materially from forward-looking statements or historical performance: failure to realize the benefits expected from the recent business acquisitions; the effects of pending and future legislation; risks related to disruption of management time from ongoing business operations due to the recent business acquisitions; macroeconomic factors beyond TransUnion’s control; risks related to TransUnion’s indebtedness and other consequences associated with mergers, acquisitions and divestitures, and legislative and regulatory actions and reforms.

TRANSUNION AND SUBSIDIARIES

Consolidated Balance Sheets

(in millions, except per share data)

September 30, 2018

December 31, 2017

Unaudited

Assets

Current assets:

Cash and cash equivalents

$

226.6

$

115.8

Trade accounts receivable, net of allowance of $13.7 and $9.9

426.1

326.7

Other current assets

160.6

146.2

Current assets of discontinued operations

72.7

—

Total current assets

886.0

588.7

Property, plant and equipment, net of accumulated depreciation and amortization of $351.6 and $299.3

198.2

198.6

Goodwill, net

3,339.0

2,368.8

Other intangibles, net of accumulated amortization of $1,141.4 and $993.6

2,570.1

1,825.8

Other assets

148.0

136.6

Total assets

$

7,141.3

$

5,118.5

Liabilities and stockholders’ equity

Current liabilities:

Trade accounts payable

$

159.1

$

131.3

Short-term debt and current portion of long-term debt

64.2

119.3

Other current liabilities

301.1

207.8

Current liabilities of discontinued operations

21.3

—

Total current liabilities

545.7

458.4

Long-term debt

4,057.6

2,345.3

Deferred taxes

529.6

419.4

Other liabilities

44.3

70.8

Total liabilities

5,177.2

3,293.9

Stockholders’ equity:

Common stock, $0.01 par value; 1.0 billion shares authorized at September 30, 2018 and December 31, 2017, 189.5 million and 187.4 million shares issued at September 30, 2018 and December 31, 2017, respectively, and 185.3 million shares and 183.2 million shares outstanding as of September 30, 2018 and December 31, 2017, respectively

1.9

1.9

Additional paid-in capital

1,923.9

1,863.5

Treasury stock at cost; 4.2 million shares at September 30, 2018 and December 31, 2017, respectively

(139.5)

(138.8)

Retained earnings

275.2

137.4

Accumulated other comprehensive loss

(193.9)

(135.3)

Total TransUnion stockholders’ equity

1,867.6

1,728.7

Noncontrolling interests

96.5

95.9

Total stockholders’ equity

1,964.1

1,824.6

Total liabilities and stockholders’ equity

$

7,141.3

$

5,118.5

TRANSUNION AND SUBSIDIARIES

Consolidated Statements of Income (Unaudited)

(in millions, except per share data)

Three Months Ended September 30,

Nine Months Ended September 30,

2018

2017

2018

2017

Revenue

$

603.6

$

498.0

$

1,704.1

$

1,427.7

Operating expenses

Cost of services (exclusive of depreciation and amortization below)

207.5

169.3

579.0

472.3

Selling, general and administrative

189.8

142.2

524.6

436.0

Depreciation and amortization

84.2

59.9

218.8

176.2

Total operating expenses

481.5

371.4

1,322.3

1,084.5

Operating income

122.1

126.6

381.7

343.2

Non-operating income and (expense)

Interest expense

(44.0)

(21.7)

(92.5)

(65.8)

Interest income

1.3

1.5

3.5

4.2

Earnings from equity method investments

3.2

2.6

8.4

6.3

Other income and (expense), net

(3.2)

(4.8)

(45.6)

(15.6)

Total non-operating income and (expense)

(42.7)

(22.4)

(126.1)

(70.9)

Income from continuing operations before income taxes

79.4

104.2

255.6

272.3

Provision for income taxes

(28.6)

(32.3)

(72.1)

(68.7)

Income from continuing operations

50.8

71.9

183.5

203.6

Discontinued operations, net of tax

(1.4)

—

(1.4)

—

Net income

49.4

71.9

182.0

203.6

Less: net income attributable to the noncontrolling interests

(3.1)

(3.1)

(7.6)

(7.6)

Net income attributable to TransUnion

$

46.3

$

68.8

$

174.4

$

196.0

Income from continuing operations

50.8

71.9

183.5

203.6

Less: income from continuing operations attributable to noncontrolling interests

(3.1)

(3.1)

(7.6)

(7.6)

Income from continuing operations attributable to TransUnion

47.7

68.8

175.9

196.0

Discontinued operations, net of tax

(1.4)

—

(1.4)

—

Net income attributable to TransUnion

$

46.3

$

68.8

$

174.4

$

196.0

Basic earnings per common share from:

Income from continuing operations attributable to TransUnion

$

0.26

$

0.38

$

0.95

$

1.08

Discontinued operations, net of tax

(0.01)

—

(0.01)

—

Net Income attributable to TransUnion

$

0.25

$

0.38

$

0.95

$

1.08

Diluted earnings per common share from:

Income from continuing operations attributable to TransUnion

$

0.25

$

0.36

$

0.92

$

1.03

Discontinued operations, net of tax

(0.01)

—

(0.01)

—

Net Income attributable to TransUnion

$

0.24

$

0.36

$

0.91

$

1.03

Weighted-average shares outstanding:

Basic

185.1

182.2

184.4

182.3

Diluted

191.2

189.2

190.8

189.8

As a result of displaying amounts in millions, rounding differences may exist in the table above.

TRANSUNION AND SUBSIDIARIES

Consolidated Statements of Cash Flows (Unaudited)

(in millions)

Nine Months Ended September 30,

2018

2017

Cash flows from operating activities:

Net income

$

182.0

$

203.6

Add: loss from discontinued operations, net of tax

1.4

—

Income from continuing operations

183.5

203.6

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

218.8

176.2

Loss on debt financing transactions

12.0

10.5

Amortization and (gain) loss on fair value of hedge instrument

(0.7)

0.5

Impairment of Cost Method Investment, net

1.5

—

Equity in net income of affiliates, net of dividends

(3.1)

(5.5)

Deferred taxes

(17.9)

(14.1)

Amortization of discount and deferred financing fees

3.2

2.0

Stock-based compensation

36.9

23.1

Payment of contingent obligation

(0.2)

(2.2)

Provision for losses on trade accounts receivable

6.3

3.3

Other

3.0

(2.1)

Changes in assets and liabilities:

Trade accounts receivable

(79.4)

(40.1)

Other current and long-term assets

(5.5)

(37.8)

Trade accounts payable

8.3

10.2

Other current and long-term liabilities

43.6

19.1

Cash provided by operating activities of continuing operations

410.3

346.7

Cash used in operating activities of discontinued operations

(0.9)

—

Cash provided by operating activities

409.4

346.7

Cash flows from investing activities:

Capital expenditures

(118.3)

(91.0)

Proceeds from sale of trading securities

1.8

2.5

Purchases of trading securities

(2.0)

(1.6)

Proceeds from sale of other investments

15.9

54.4

Purchases of other investments

(22.7)

(42.1)

Acquisitions and purchases of noncontrolling interests, net of cash acquired

For the Three Months Ended September 30, 2018 Compared with the Three Months Ended September 30, 2017

Reported

CC Growth(1)

Inorganic(2)

Organic Growth(3)

Organic CC Growth(4)

Revenue:

Consolidated

21.2

%

22.4

%

11.2

%

10.0

%

11.2

%

USIS

20.1

%

20.1

%

8.8

%

11.3

%

11.3

%

Online

17.5

%

17.5

%

6.5

%

11.0

%

11.0

%

Marketing Services

22.8

%

22.8

%

—

%

22.8

%

22.8

%

Decision Services

26.4

%

26.4

%

23.0

%

3.4

%

3.4

%

International

35.6

%

41.7

%

29.7

%

5.8

%

12.0

%

Developed Markets

89.1

%

92.3

%

83.6

%

5.5

%

8.7

%

Emerging Markets

6.0

%

13.8

%

—

%

6.0

%

13.8

%

Consumer Interactive

11.3

%

11.3

%

—

%

11.3

%

11.3

%

Adjusted Revenue:

Consolidated

24.8

%

25.9

%

14.8

%

10.0

%

11.2

%

USIS

20.5

%

20.5

%

9.2

%

11.3

%

11.3

%

Online

17.5

%

17.5

%

6.5

%

11.0

%

11.0

%

Marketing Services

22.8

%

22.8

%

—

%

22.8

%

22.8

%

Decision Services

28.1

%

28.1

%

24.7

%

3.4

%

3.4

%

International

53.1

%

59.3

%

47.2

%

5.8

%

12.0

%

Developed Markets

138.3

%

141.5

%

132.8

%

5.5

%

8.7

%

Emerging Markets

6.0

%

13.8

%

—

%

6.0

%

13.8

%

Consumer Interactive

11.3

%

11.3

%

—

%

11.3

%

11.3

%

Operating Income:

Consolidated

(3.6)

%

(2.0)

%

(21.2)

%

17.6

%

19.2

%

USIS

12.4

%

12.3

%

(8.2)

%

20.6

%

20.6

%

International

(80.4)

%

(70.5)

%

(100.6)

%

20.2

%

30.2

%

Consumer Interactive

21.7

%

21.7

%

—

%

21.7

%

21.7

%

Adjusted Operating Income:

Consolidated

26.3

%

27.7

%

11.5

%

14.9

%

16.3

%

USIS

19.2

%

19.2

%

4.6

%

14.6

%

14.6

%

International

54.4

%

61.8

%

44.0

%

10.4

%

17.8

%

Consumer Interactive

21.5

%

21.5

%

—

%

21.5

%

21.5

%

Adjusted EBITDA:

Consolidated

26.1

%

27.6

%

(1) CC (constant currency) growth rates assume foreign currency exchange rates are consistent between years. This allows financial results to be evaluated without the impact of fluctuations in foreign currency exchange rates.(2) Inorganic growth rate represents growth attributable to the first twelve months of activity for recent business acquisitions.(3) Organic growth rate is the GAAP growth rate less the inorganic growth rate.

Reconciliation of net income attributable to TransUnion to Adjusted EBITDA:

Net income attributable to TransUnion

$

46.3

$

68.8

$

174.4

$

196.0

Discontinued operations

1.4

—

1.4

—

Net income from continuing operations attributable to TransUnion

47.7

68.8

175.9

196.0

Net interest expense

42.6

20.2

89.0

61.6

Provision for income taxes

28.6

32.3

72.1

68.7

Depreciation and amortization

84.2

59.9

218.8

176.2

EBITDA

203.2

181.3

555.8

502.6

Adjustments to EBITDA:

Acquisitions revenue-related adjustment (1)

17.7

—

17.7

—

Stock-based compensation(2)

16.3

9.5

43.2

34.3

Mergers and acquisitions, divestitures and business optimization(3)

6.2

(1.7)

35.3

5.2

Other(4)

1.5

5.0

16.1

9.8

Total adjustments to EBITDA

41.7

12.9

112.4

49.3

Adjusted EBITDA

$

244.9

$

194.1

$

668.1

$

551.9

EBITDA margin

33.7

%

36.4

%

32.6

%

35.2

%

Adjusted EBITDA Margin

39.4

%

39.0

%

38.8

%

38.7

%

As a result of displaying amounts in millions, rounding differences may exist in the table above.

(1) This adjustment represents certain non-cash adjustments related to acquired entities, predominantly adjustments to increase revenue resulting from purchase accounting reductions to deferred revenue we record on the opening balance sheets of acquired entities. Deferred revenue results when a company receives payment in advance of fulfilling their performance obligations under contracts. Business combination accounting rules require us to record deferred revenue of acquired entities at fair value if we are obligated to perform any future services under these contracts. The fair value of this deferred revenue is determined based on the direct and indirect incremental costs of fulfilling our performance obligations under these contracts, plus a normal profit margin. Generally, this fair value calculation results in a reduction to the purchased deferred revenue balance. The above adjustment includes an estimate for the increase in revenue equal to the difference between what the acquired entities would have recorded as revenue and the lower revenue we record as a result of the reduced deferred revenue balance. This increase is partially offset by an estimated decrease to revenue for certain acquired non-core customer contracts that are not classified as discontinued operations that will expire within approximately one year. We present Adjusted Revenue as a supplemental measure of our revenue because we believe it provides meaningful information regarding our revenue and provides a basis to compare revenue between periods. In addition, our board of directors and executive management team use Adjusted Revenue as a compensation measure under our incentive compensation plan. The table above provides a reconciliation for revenue to Adjusted Revenue. The estimated adjustments to revenue are subject to change as we finalize the fair value assessments of the deferred revenue acquired with recent acquisitions and as we complete our assessment of the non-core customer contracts.

(3) For the three months ended September 30, 2018, consisted of the following adjustments to operating income: $4.2 million of Callcredit integration costs; a $0.2 million loss on the divestiture of a small business operation; and a $0.1 million adjustment to contingent consideration expense from previous acquisitions. For the three months ended September 30, 2018, consisted of the following adjustments to non-operating income and expense: $1.7 million of acquisition expenses; a $0.2 million loss from a fair value remeasurement of an investment in a nonconsolidated affiliate; a $(0.1) million offset to the loss included in operating income adjustments on the divestiture of a small business operation for the portion that is attributable to the non-controlling interest; and $(0.1) million of miscellaneous. For the nine months ended September 30, 2018, consisted of the following adjustments to operating income: $4.2 million of Callcredit integration costs and a $1.2 million loss on the divestiture of a small business operation; and a $0.1 million adjustment to contingent consideration expense from previous acquisitions. For the nine months ended September 30, 2018, consisted of the following adjustments to non-operating income and expense: $28.7 million of acquisition expenses; a $1.5 million net loss from the fair value remeasurements of investments in nonconsolidated affiliates; and a $(0.4) million offset to the loss included in operating income adjustments on the divestiture of a small business operation for the portion that is attributable to the non-controlling interest.

For the three months ended September 30, 2017, consisted of the following adjustments to operating income: a $0.4 million adjustment to contingent consideration expense from previous acquisitions. For the three months ended September 30, 2017, consisted of the following adjustments to non-operating income and expense: a $(2.0) million net reduction in acquisition expenses resulting from a reimbursement of certain acquisition costs recorded in prior periods partially offset by other acquisition costs; and $(0.1) million of miscellaneous. For the nine months ended September 30, 2017, consisted of the following adjustments to operating income: a $0.5 million loss on the divestiture of a small business operation; and a $0.2 million adjustment to contingent consideration expense from previous acquisitions. For the nine months ended September 30, 2017, consisted of the following adjustments to non-operating income and expense: $4.5 million of acquisition expenses.

(4) For the three months ended September 30, 2018, consisted of the following adjustments to non-operating income and expense: a $1.0 million loss from currency remeasurement of our foreign operations; $0.5 million of loan fees; $0.1 million of fees related to new financing under our senior secured credit facility; and $(0.1) million of miscellaneous. For the nine months ended September 30, 2018, consisted of the following adjustments to non-operating income and expense: $12.0 million of fees related to new financing under our senior secured credit facility; a $3.3 million loss from currency remeasurement of our foreign operations; $1.1 million of loan fees; $0.5 million of fees incurred in connection with a secondary offering of shares of TransUnion common stock by certain of our stockholders; a $(0.7) million mark-to-market gain related to ineffectiveness of our interest rate hedge; and $(0.1) million of miscellaneous.

For the three months ended September 30, 2017, consisted of the following adjustments to operating income and expense: a $(1.3) million reduction to expense for certain legal and regulatory matters; and a $(0.6) million reduction to expense for sales and use tax matters. For the three months ended September 30, 2017, consisted of the following adjustments to non-operating income and expense: $5.6 million of fees related to the refinancing of our senior secured credit facility; $0.5 million of currency remeasurement of our foreign operations; $0.4 million of fees incurred in connection with a secondary offering of shares of TransUnion common stock by certain of our stockholders; $0.3 million of loan fees; and $0.1 million mark-to-market loss related to ineffectiveness of our interest rate hedge. For the nine months ended September 30, 2017, consisted of the following adjustments to operating income and expense: a $(1.3) million reduction to expense for certain legal and regulatory matters; and a $(0.6) million reduction to expense for sales and use tax matters. For the nine months ended September 30, 2017, consisted of the following adjustments to non-operating income and expense: $10.5 million of fees related to the refinancing of our senior secured credit facility; $1.4 million of fees incurred in connection with secondary offerings of shares of TransUnion common stock by certain of our stockholders; $1.1 million of loan fees; a $0.2 million mark-to-market loss related to ineffectiveness of our interest rate hedge; $(1.1) million of currency remeasurement of our foreign operations; and $(0.4) million of miscellaneous.

SCHEDULE 3

TRANSUNION AND SUBSIDIARIES

Adjusted Net Income and Adjusted Earnings Per Share - Unaudited

(in millions, except per share data)

Three Months Ended September 30,

Nine Months Ended September 30,

2018

2017

2018

2017

Net income attributable to TransUnion

$

46.3

$

68.8

$

174.4

$

196.0

Discontinued operations

1.4

—

1.4

—

Net income from continuing operations attributable to TransUnion

47.7

68.8

175.9

196.0

Adjustments before income tax items:

Acquisitions revenue-related adjustment (1)

17.7

—

17.7

—

Stock-based compensation(2)

16.3

9.5

43.2

34.3

Mergers and acquisitions, divestitures and business optimization(3)

6.2

(1.7)

35.3

5.2

Other(4)

1.0

4.8

15.0

9.2

Amortization of certain intangible assets(5)

52.1

33.7

127.0

100.8

Total adjustments before income tax items

93.4

46.3

238.2

149.5

Change in provision for income taxes per schedule 4

(16.4)

(22.4)

(63.1)

(84.4)

Adjusted Net Income

$

124.7

$

92.7

$

351.0

$

261.1

Adjusted Earnings per Share:

Basic

$

0.67

$

0.51

$

1.90

$

1.43

Diluted(6)

$

0.65

$

0.49

$

1.84

$

1.38

Weighted-average shares outstanding:

Basic

185.1

182.2

184.4

182.3

Diluted(6)

191.2

189.2

190.8

189.8

As a result of displaying amounts in millions, rounding differences may exist in the table above.

(1) This adjustment represents certain non-cash adjustments related to acquired entities, predominantly adjustments to increase revenue resulting from purchase accounting reductions to deferred revenue we record on the opening balance sheets of acquired entities. Deferred revenue results when a company receives payment in advance of fulfilling their performance obligations under contracts. Business combination accounting rules require us to record deferred revenue of acquired entities at fair value if we are obligated to perform any future services under these contracts. The fair value of this deferred revenue is determined based on the direct and indirect incremental costs of fulfilling our performance obligations under these contracts, plus a normal profit margin. Generally, this fair value calculation results in a reduction to the purchased deferred revenue balance. The above adjustment includes an estimate for the increase in revenue equal to the difference between what the acquired entities would have recorded as revenue and the lower revenue we record as a result of the reduced deferred revenue balance. This increase is partially offset by an estimated decrease to revenue for certain acquired non-core customer contracts that are not classified as discontinued operations that will expire within approximately one year. We present Adjusted Revenue as a supplemental measure of our revenue because we believe it provides meaningful information regarding our revenue and provides a basis to compare revenue between periods. In addition, our board of directors and executive management team use Adjusted Revenue as a compensation measure under our incentive compensation plan. The table above provides a reconciliation for revenue to Adjusted Revenue. The estimated adjustments to revenue are subject to change as we finalize the fair value assessments of the deferred revenue acquired with recent acquisitions and as we complete our assessment of the non-core customer contracts.

(3) For the three months ended September 30, 2018, consisted of the following adjustments to operating income: $4.2 million of Callcredit integration costs; a $0.2 million loss on the divestiture of a small business operation; and a $0.1 million adjustment to contingent consideration expense from previous acquisitions. For the three months ended September 30, 2018, consisted of the following adjustments to non-operating income and expense: $1.7 million of acquisition expenses; a $0.2 million loss from a fair value remeasurement of an investment in a nonconsolidated affiliate; a $(0.1) million offset to the loss included in operating income adjustments on the divestiture of a small business operation for the portion that is attributable to the non-controlling interest; and $(0.1) million of miscellaneous. For the nine months ended September 30, 2018, consisted of the following adjustments to operating income: $4.2 million of Callcredit integration costs and a $1.2 million loss on the divestiture of a small business operation; and a $0.1 million adjustment to contingent consideration expense from previous acquisitions. For the nine months ended September 30, 2018, consisted of the following adjustments to non-operating income and expense: $28.7 million of acquisition expenses; a $1.5 million net loss from the fair value remeasurements of investments in nonconsolidated affiliates; and a $(0.4) million offset to the loss included in operating income adjustments on the divestiture of a small business operation for the portion that is attributable to the non-controlling interest.

For the three months ended September 30, 2017, consisted of the following adjustments to operating income: a $0.4 million adjustment to contingent consideration expense from previous acquisitions. For the three months ended September 30, 2017, consisted of the following adjustments to non-operating income and expense: a $(2.0) million net reduction in acquisition expenses resulting from a reimbursement of certain acquisition costs recorded in prior periods partially offset by other acquisition costs; and $(0.1) million of miscellaneous. For the nine months ended September 30, 2017, consisted of the following adjustments to operating income: a $0.5 million loss on the divestiture of a small business operation; and a $0.2 million adjustment to contingent consideration expense from previous acquisitions. For the nine months ended September 30, 2017, consisted of the following adjustments to non-operating income and expense: $4.5 million of acquisition expenses.

(4) For the three months ended September 30, 2018, consisted of the following adjustments to non-operating income and expense: a $1.0 million loss from currency remeasurement of our foreign operations; $0.1 million of fees related to new financing under our senior secured credit facility; and $(0.1) million of miscellaneous. For the nine months ended September 30, 2018, consisted of the following adjustments to non-operating income and expense: $12.0 million of fees related to new financing under our senior secured credit facility; a $3.3 million loss from currency remeasurement of our foreign operations; $0.5 million of fees incurred in connection with a secondary offering of shares of TransUnion common stock by certain of our stockholders; a $(0.7) million mark-to-market gain related to ineffectiveness of our interest rate hedge; and $(0.1) million of miscellaneous.

For the three months ended September 30, 2017, consisted of the following adjustments to operating income: a $(1.3) million reduction to expense for certain legal and regulatory matters; and a $(0.6) million reduction to expense for sales and use tax matters. For the three months ended September 30, 2017, consisted of the following adjustments to non-operating income and expense: $5.6 million of expense related to the refinancing of our senior secured credit facility; $0.5 million of currency remeasurement of our foreign operations; $0.4 million of fees incurred in connection with a secondary offering of shares of TransUnion common stock by certain of our stockholders; a $0.1 million mark-to-market loss related to ineffectiveness of our interest rate hedge; and $0.1 million of miscellaneous. For the nine months ended September 30, 2017, consisted of the following adjustments to operating income and expense: a $(1.3) million reduction to expense for certain legal and regulatory matters; and a $(0.6) million reduction to expense for sales and use tax matters. For the nine months ended September 30, 2017, consisted of the following adjustments to non-operating income and expense: $10.5 million of fees related to the refinancing of our senior secured credit facility; $1.4 million of fees incurred in connection with secondary offerings of shares of TransUnion common stock by certain of our stockholders; a $0.2 million mark-to-market loss related to ineffectiveness of our interest rate hedge; $0.1 million of miscellaneous; and $(1.1) million of currency remeasurement of our foreign operations.

(5) Consisted of amortization of intangible assets from our 2012 change in control and amortization of intangible assets established in business acquisitions after our 2012 change in control.

(6) For the three and nine months ended September 30, 2018, there were less than 0.1 million anti-dilutive weighted stock-based awards outstanding for each respective period. In addition, there were less than 1.1 million contingently issuable stock-based awards outstanding that were excluded from the diluted earnings per share calculation because the contingencies had not been met.

For the three and nine months ended September 30, 2017, there were less than 0.1 million anti-dilutive weighted stock-based awards outstanding. In addition, there were no contingently issuable stock-based awards outstanding that were excluded from the diluted earnings per share calculation because the contingencies had not been met.

SCHEDULE 4

TRANSUNION AND SUBSIDIARIES

Effective Tax Rate and Adjusted Effective Tax Rate - Unaudited

(dollars in millions)

Three Months Ended September 30,

Nine Months Ended September 30,

2018

2017

2018

2017

Income before income taxes

$

79.4

$

104.2

$

255.6

$

272.3

Total adjustments before income taxes per Schedule 3

93.4

46.3

238.2

149.5

Adjusted income before income taxes

$

172.8

$

150.5

$

493.8

$

421.8

Provision for income taxes

$

(28.6)

$

(32.3)

$

(72.1)

$

(68.7)

Adjustments for income taxes:

Tax effect of above adjustments(1)

(16.1)

(16.0)

(50.2)

(50.7)

Eliminate impact of adjustments for unremitted foreign earnings(2)

—

(0.9)

—

(5.2)

Eliminate impact of excess tax benefits for share compensation(3)

(7.6)

(5.0)

(25.7)

(28.1)

Eliminate one-time impact of U.S. tax reform items(4)

5.6

—

5.6

—

Other(5)

1.8

(0.4)

7.2

(0.5)

Total adjustments for income taxes

(16.4)

(22.4)

(63.1)

(84.4)

Adjusted provision for income taxes

$

(45.0)

$

(54.7)

$

(135.2)

$

(153.1)

Effective tax rate

36.0

%

31.0

%

28.2

%

25.2

%

Adjusted Effective Tax Rate

26.0

%

36.4

%

27.4

%

36.3

%

As a result of displaying amounts in millions, rounding differences may exist in the table above.

(1) Tax rates used to calculate the tax expense impact are based on the nature of each item.

(4) Eliminates the one-time impacts of U.S. tax reform, including remeasurement of acquisition-related domestic deferred tax balances at the new 21% tax rate and mandatory repatriation of unremitted earnings net of previously recorded reserves.

(5) Eliminates the impact of state tax rate changes on deferred taxes, valuation allowances on foreign net operating losses, and valuation allowances on capital losses and other discrete adjustments.

As a result of displaying amounts in millions, rounding differences may exist in the table above.

(1) This adjustment represents certain non-cash adjustments related to acquired entities, predominantly adjustments to increase revenue resulting from purchase accounting reductions to deferred revenue we record on the opening balance sheets of acquired entities. Deferred revenue results when a company receives payment in advance of fulfilling their performance obligations under contracts. Business combination accounting rules require us to record deferred revenue of acquired entities at fair value if we are obligated to perform any future services under these contracts. The fair value of this deferred revenue is determined based on the direct and indirect incremental costs of fulfilling our performance obligations under these contracts, plus a normal profit margin. Generally, this fair value calculation results in a reduction to the purchased deferred revenue balance. The above adjustment includes an estimate for the increase in revenue equal to the difference between what the acquired entities would have recorded as revenue and the lower revenue we record as a result of the reduced deferred revenue balance. This increase is partially offset by an estimated decrease to revenue for certain acquired non-core customer contracts that are not classified as discontinued operations that will expire within approximately one year. We present Adjusted Revenue as a supplemental measure of our revenue because we believe it provides meaningful information regarding our revenue and provides a basis to compare revenue between periods. In addition, our board of directors and executive management team use Adjusted Revenue as a compensation measure under our incentive compensation plan. The table above provides a reconciliation for revenue to Adjusted Revenue. The estimated adjustments to revenue are subject to change as we finalize the fair value assessments of the deferred revenue acquired with recent acquisitions and as we complete our assessment of the non-core customer contracts. For the three- and nine-month periods the adjustment to revenue by segment were as follows: $1.1 million USIS; and $16.6 million International.

(3) For the three months ended September 30, 2018, consisted of the following adjustments to operating income: $4.2 million of Callcredit integration-related expenses (International); a $0.1 million loss on the divestiture of a small business operation (International); and a $0.1 million adjustment to contingent consideration expense from previous acquisitions (USIS). For the nine months ended September 30, 2018, consisted of the following adjustments to operating income: $4.2 million of Callcredit integration-related expenses (International); a $1.2 million loss on the divestiture of a small business operation (International); and a $0.1 million adjustment to contingent consideration expense from previous acquisitions (USIS).

For the three months ended September 30, 2017, consisted of the following adjustments to operating income: a $0.4 million adjustment to contingent consideration expense from previous acquisitions (USIS). For the nine months ended September 30, 2017, consisted of the following adjustments to operating income: a $0.5 million loss on the divestiture of a small business operation (International); and a $0.2 million adjustment to contingent consideration expense from previous acquisitions (USIS).

(4) For the three months ended September 30, 2017, consisted of the following adjustments to operating income: a $(1.3) million reduction to expense for certain legal and regulatory matters (Corporate); and a $(0.6) million reduction to expense for sales and use tax matters (USIS). For the nine months ended September 30, 2017, consisted of the following adjustments to operating income: a $(1.3) million reduction to expense for certain legal and regulatory matters (Corporate); and a $(0.6) million reduction to expense for sales and use tax matters (USIS).

(5) Consisted of amortization of intangible assets from our 2012 change in control transaction and amortization intangible assets established in business acquisitions after our 2012 change in control.

(6) Segment operating margins are calculated using segment gross revenue and operating income. Segment Adjusted Operating Margins are calculated using segment gross Adjusted Revenue and segment Adjusted Operating Income. Consolidated operating margin is calculated using total revenue as reported and operating income as reported. Consolidated Adjusted Operating Margin is calculated using total Adjusted Revenue and total Adjusted Operating Income.

SCHEDULE 6

TRANSUNION AND SUBSIDIARIES

Segment Depreciation and Amortization - Unaudited

(dollars in millions)

Three Months Ended September 30,

Nine Months Ended September 30,

2018

2017

2018

2017

Depreciation and amortization:

USIS

$

49.4

$

40.0

$

139.7

$

118.7

International

30.5

15.9

66.4

45.5

Consumer Interactive

3.1

2.7

9.0

8.1

Corporate

1.3

1.3

3.8

3.9

Total depreciation and amortization

$

84.2

$

59.9

$

218.8

$

176.2

As a result of displaying amounts in millions, rounding differences may exist in the table above.

SCHEDULE 7

TRANSUNION AND SUBSIDIARIES

Reconciliation of Non-GAAP Guidance - Unaudited

(dollars in millions)

Three Months Ended December 30, 2018

Twelve Months Ended December 31, 2018

Low

High

Low

High

Guidance reconciliation of revenue to Adjusted Revenue:

GAAP revenue

$

610

$

615

$

2,314

$

2,319

Acquisitions revenue-related adjustment(1)

11

11

28

28

Adjusted Revenue

620

625

2,342

2,347

Guidance reconciliation of net income attributable to TransUnion to Adjusted EBITDA:

Net income (loss) attributable to TransUnion

58

60

232

234

Discontinued operations, net of tax

(1)

(1)

—

—

Net income attributable to TransUnion from continuing operations

57

59

233

235

Interest, taxes and depreciation and amortization

152

152

531

532

EBITDA

208

211

764

767

Acquisitions revenue-related adjustment(1)

11

11

28

28

Stock-based compensation, mergers, acquisitions divestitures and business optimization-related expenses and other adjustments(2)

25

25

119

119

Adjusted EBITDA

$

243

$

246

$

912

$

915

Reconciliation of diluted earnings per share from continuing operations to Adjusted Diluted Earnings per Share from Continuing Operations:

Diluted earnings per share from continuing operations

$

0.30

$

0.31

$

1.22

$

1.23

Adjustments to diluted earnings per share(1)(2)

0.32

0.32

1.24

1.24

Adjusted Diluted Earnings per Share from Continuing Operations

$

0.62

$

0.63

$

2.46

$

2.47

As a result of displaying amounts in millions, rounding differences may exist in the table above.

(1) This adjustment represents certain non-cash adjustments related to acquired entities, predominantly adjustments to increase revenue resulting from purchase accounting reductions to deferred revenue we record on the opening balance sheets of acquired entities. Deferred revenue results when a company receives payment in advance of fulfilling their performance obligations under contracts. Business combination accounting rules require us to record deferred revenue of acquired entities at fair value if we are obligated to perform any future services under these contracts. The fair value of this deferred revenue is determined based on the direct and indirect incremental costs of fulfilling our performance obligations under these contracts, plus a normal profit margin. Generally, this fair value calculation results in a reduction to the purchased deferred revenue balance. The above adjustment includes an estimate for the increase in revenue equal to the difference between what the acquired entities would have recorded as revenue and the lower revenue we record as a result of the reduced deferred revenue balance. This increase is partially offset by an estimated decrease to revenue for certain acquired non-core customer contracts that are not classified as discontinued operations that will expire within approximately one year. We present Adjusted Revenue as a supplemental measure of our revenue because we believe it provides meaningful information regarding our revenue and provides a basis to compare revenue between periods. In addition, our board of directors and executive management team use Adjusted Revenue as a compensation measure under our incentive compensation plan. The table above provides a reconciliation for revenue to Adjusted Revenue. The estimated adjustments to revenue are subject to change as we finalize the fair value assessments of the deferred revenue acquired with recent acquisitions and as we complete our assessment of the non-core customer contracts.

(2) This adjustment includes the same adjustments we make to our Adjusted EBITDA and Adjusted Net Income as discussed in the Non-GAAP Financial Measures section of our earnings release, which includes the Callcredit integration-related costs.

Callcredit Exhibit 99.2

Reconciliation of Adjusted Revenue and Adjusted EBITDA

(amounts in millions)

The tables below present a reconciliation of the revenue and operating income (loss) of Callcredit, as reflected in Note 2 of the financial statements included in our Form 10-Q filed with the SEC on October 23, 2018, to the non-GAAP measures of Adjusted Revenue and Adjusted EBITDA, respectively, for the nine months ended September 30, 2018.

Reconciliation of revenue to Adjusted Revenue:

YTD September 30, 2018

Callcredit revenue per Note 2 to the accompanying financial statements

$

35.9

Add-backs:

Deferred revenue fair value impact(1)

17.7

Deductions:

Revenue from non-core customer contracts(2)

(1.1)

Callcredit Adjusted Revenue

$

52.5

Due to displaying amounts in millions, the table above may not foot.

Footnotes:

(1) Represents an adjustment to reflect the amount of revenue that would have been recognized, had deferred revenue not been reduced to estimated fair value in accordance with the acquisition method of accounting under U.S. GAAP.

(2) Represents an adjustment to reduce post-acquisition revenue from certain non-core customer contracts of Callcredit that are not classified as discontinued operations and that will expire within approximately one year.

Reconciliation of operating income (loss) to Adjusted EBITDA:

YTD September 30, 2018

Callcredit operating income (loss) per Note 2 to the accompanying financial statements

$

(18.9)

Add-backs:

Deferred revenue fair value impact(1)

16.6

Depreciation and amortization

15.5

Integration costs(2)

4.2

Adjusted EBITDA

$

17.4

Adjusted EBITDA margin

33.1

%

Due to displaying amounts in millions, the table above may not foot.

Footnotes:

(1) Represents an adjustment to reflect the amount of revenue that would have been recognized, had deferred revenue not been reduced to estimated fair value in accordance with the acquisition method of accounting under U.S. GAAP, partially offset by a decrease to revenue for certain acquired non-core customer contracts that are not classified as discontinued operations that will expire within approximately one year.

(3) Represents an adjustment to reduce post-acquisition operating income from certain non-core customer contracts of Callcredit that are not classified as discontinued operations and that will expire within approximately one year.

The tables below present a reconciliation of the combined pro forma revenue and pro forma net income of continuing operations of TransUnion and Callcredit, as reflected in Note 2 of the financial statements included in our Form 10-Q filed with the SEC on October 23, 2018, to pro forma Adjusted Revenue and pro forma Adjusted EBITDA for the nine months ended September 30, 2018 and 2017, assuming TransUnion's acquisition of Callcredit occurred on January 1, 2017.

Reconciliation of Revenue to Adjusted pro forma revenue:

YTD September 30, 2018

YTD September 30, 2017

Pro forma revenue per Note 2 to the accompanying financial statements

$

1,791.8

$

1,516.5

Adjustments:

Deferred revenue fair value impact(1)

18.4

36.8

Revenue from non-core customer contracts(2)

(2.1)

(3.1)

Pro forma Adjusted Revenue

$

1,808.1

$

1,550.2

Due to displaying amounts in millions, the table above may not foot.

Footnotes:

(1) Represents and adjustment for pre- and post-acquisition revenue that would have been recognized, had deferred revenue not been reduced to estimated fair value in accordance with the acquisition method of accounting under U.S. GAAP.

(2) Represents an adjustment to reduce pre- and post-acquisition revenue from certain non-core customer contracts of Callcredit that are not classified as discontinued operations and that will expire within approximately one year.

Reconciliation of net income from continuing operations to pro formaAdjust Net Income from Continuing Operations:

YTD September 30, 2018

YTD September 30, 2017

Pro forma net income from continuing operations per Note 2 to the accompanying financial statements

$

165.8

$

50.7

Net interest expense

122.0

103.7

Provision for income taxes

84.7

44.2

Depreciation and amortization

245.1

216.0

Pro Forma EBIDTA

617.6

414.6

Adjustments:

Deferred revenue fair value impact(1)

18.5

36.8

Stock-based compensation(2)

43.2

34.2

Mergers and acquisitions, divestitures and business optimization(3)

3.5

84.9

Other(4)

17.7

21.1

Total adjustments

82.9

177.0

Pro forma Adjusted EBITDA

$

700.5

$

591.6

Pro forma Adjusted EBITDA margin

38.7

%

38.2

%

Due to displaying amounts in millions, the table above may not foot.

Footnotes:

(1) Represents all of the pro forma adjustments as reflected in Exhibit 99.2 of our Form 8-K filed with the SEC on August 27, 2018, and similar adjustments for the second and third quarters of 2018.